News-tc-Talotta

Unequal law

Belgium tax law allowed for a taxpayer's deemed income to be determined in the absence of information supplied by the taxpayer. With regard to non-residents a tax base was applied (article 342(2)) which was calculated according to the taxpayer's turnover and the number of his employees.
A Luxembourg resident ran a restaurant in Belgium. He submitted his tax returns late and was assessed to tax on the basis of article 342(2). He objected to the charge. The matter was referred to the European Court of Justice to decide whether such treatment of non-residents was contrary to article 43 of the EC Treaty (freedom of establishment).
The European Court of Justice said that the general rule was that residents and non-residents were not comparable for tax purposes except where a tax advantage available to a resident was denied to a non-resident and this could...